The employee was charged with driving under the influence and ultimately convicted of the offence.

As it turned out, the employee was an alcoholic. Prior to his conviction, he had sought treatment and concluded the program. The discharge report indicated, among other things, that he succesfully completed the program and “openly addressed his history of substance abuse and the impact it had on his life and that of others, as well as his “relationship and boundaries issues”.” The report further noted that he had agreed to an after-care plan and a variety of clinical recommendations.

As in all discipline cases where no specific penalty is provided in the collective agreement, the adjudicator follows a two step process:

whether or not the company had cause to discharge (or discipline) the grievor; and

if it did, the next issue is whether or not the adjudicator should substitute the discharge (discipline) with a less severe penalty.

The second issue involves an assessment of all of the surrounding circumstances and a variety of well established mitigating factors or unique or extenuating circumstances.

In this case, Vice-Chair Kelly held that the employer had just cause to discharge the grievor from his employment. He reviewed a number of decisions on point. This being said, Vice-Chair Kelly concluded as follows:

In my view, having regard to what the grievor did on August 9, 2012, the company had cause to discharge him from employment. It was extremely serious, and potentially lethal misconduct. However, when all things are considered, including that the grievor was an alcoholic at the time of the incident, I consider it just and reasonable to substitute the discharge with a lesser penalty.

He considered, among other things, the following mitigating factors:

a clean disciplinary record

a “fairly substantial” amount of service

the grievor appeared to recognize the seriousness of his misconduct in driving impaired and he admitted an addiction

he sincerely apologized

he immediately took steps to deal with his adiction (though, according to the Vice-Chair, he had not done enough yet)

the evidence was that he has remained sober

In terms of aggravating factors:

The grievor put his safety and the safety of the travelling public at grave risk. He exposed the company to potentially massive liability and harmful publicity. Also, albeit on a much smaller scale, the company lost the use of the impounded vehicle for a period of time.

In the end, the Board found that the mitigating factors outweighed the aggravating factors. The Board reinstated the grievor on conditions including a specific penalty in the event of breach.

The Moral of the Story

To state the obvious, these are complicated cases that require a deft balancing of important corporate and individual interests. In the end, the Board, in this case, found that the personal mitigating circumstances outweighed the extremely serious corporate concerns. The Board believed, obviously, that this employee deserved a second chance and, clearly, this will not be so in every case.

That being said, the case emphasizes that discharge is not automatic and that even where extremely serious misconduct is proven a consideration of all surrounding circumstances must be considered. These are tough cases, and the result will often come down to intangibles that are unpredictable at the outset, including the demeneour of the grievor and the discretion of the particular adjudicator. These are not thinks that are known at the time of termination but clearly, as in this case, determined the outcome.

February 23, 2015

A labour arbitrator considered when the presence of mitigating factors (including, what the arbitrator described as “a painful, if not abusive, relationship with her former common-law partner” and drug use) were sufficient to reinstate an employee terminated for admitted theft. The case is Canada Post Corp. (2014), 121 C.L.A.S. 189 (M. Picher).

The Association argued that these factors, offered by way of explanation rather than excuse, should result in the reinstatement of the griever to her employment (notwithstanding the seriousness of the offence she committed). The Arbitrator said that:

The difficulty I have with the fundamental position asserted by the Association is to accept that her conscious and repeated acts of theft can be understood or excused on the basis of her admitted personal stresses and ongoing drug use.

There is nothing in the evidence before me to suggest, must less confirm, that the grievor was bereft of judgement or of the ability to make decisions, by reason of her involvement with drugs.

He then goes on to make the following damning comment:

What emerges, unfortunately, is a picture of the grievor as person who can be selective, if not deceptive, in her account of events and her overall truthfulness with respect to disclosing the full facts. Having regard to the totality of her evidence in these proceedings, and to her dealings with others in the past as reflected in the testimony before me, I am left with some difficulty as to the grievor's overall credibility. I say that with some regret, as I do not doubt that she has suffered greatly in her personal life and may well, as she asserts, have turned the page and may now hopefully be moving towards being a better and more responsible person in relation to her children, to others and to herself.

The arbitrator concluded that, in the circumstances, to return to grievor with the employer would “constitute unfairness towards the Corporation both as regards the presence of the grievor in the workplace and the undermining of the deterrent effect which her discipline should have for other employees in the bargaining unit.”. Accordingly, the“actions did irrevocably break the bond of trust essential to her ongoing employment”.

The Moral of this Story

In Ontario, save where the parties have agreed to a specific penalty in their collective agreement, the arbitrator has jurisdiction to substitute a penalty for the one imposed by the employer. Among the factors that will be considered are those identified by Arbitrator Harry Arthurs in Canadian Broadcasting Corporation and CUPE, (1979), 23 L.A.C. (2d) 227 (Arthurs):

bona fide confusion or mistake by the grievor as to whether he was entitled to do the act complained of;

the grievor’s inability , due to drunkenness or emotional problems, to appreciate the wrongfulness of his act;

the impulsive or non-premeditated nature of the act;

the relatively trivial nature of the harm done;

the frank acknowledgement of his misconduct by the grievor;

the existence of a sympathetic, personal motive for dishonesty, such as family need, rather than hardened criminality;

the past record of the grievor;

the grievor’s future prospects for likely good behaviour, and

the economic impact of discharge in view of the grievor’s age, personal circumstances, etc.

But compassion cannot, according to Goodyear Canada Inc. (2005), CanLII 57507 (ON LA) and Ontario Power Generation Inc. (2000) 125 L.A.C. (4th) 286 (Swan) “trump either the seriousness of the Grievor’s two culminating offences nor their effect on the employment relationship.”

In any event, this case supports the proposition that termination is not an automatic penalty, even in a case of admitted theft, and consideration of all surrounding circumstances will be required in arriving at the appropriate penalty.

9.11(a) An employee who properly reports for work at the beginning of his regular shift, unless he has been notified at least two hours before the commencement of his shift not to report, will receive at least four (4) hours work at his straight time base hourly rate or shall be paid for the four hours at his straight time base hourly rate, except in cases of labour disputes, machinery, equipment, power or other utility break downs, fire, flood or any other causes, without limitation, beyond the control of the company. [Emphasis added]

The employer cancelled the afternoon shift and did not provide at least two (2) hours notice prior to the commencement of the shift. The only issue was whether or not the Company was exempt from having to pay employees reporting pay because the shift was cancelled for “other causes, without limitation, beyond the control of the company”.

In this case, the shift was cancelled due to a snowstorm.

The arbitrator reported that:

There is no dispute that weather forecasts indicated a significant amount of snow accumulation (15-20 or more centimetres) in the Hamilton region. The forecasts advised that snow would fall, heavily at times, beginning late during the evening of February 4, 2014, and into the morning on February 5, 2014. Reports from Environment Canada confirm that snow was falling on February 5, 2014, from midnight until approximately 7:00 p.m. Environment Canada reports also confirm that the heaviest snow accumulation and blowing snow occurred between the period of noon until 2:00 p.m. on February 5, 2014.

The employer determined, based on a variety of considerations, that it would cancel the shift.

The union argued that the employer panicked in doing so and did not act reasonably. Accordingly, the events on February 5, 2014 were not beyond the employers control and, as such, the employer was required to provide 4 hours reporting pay to the affected employees.

The company denied this and held that reporting pay was not required as the snowstorm was clearly “beyond its control” and fell within the exemption in the collective agreement. They made arrangements to use a third party to clear the snow.

The parties have been down this road before and Arbitrator Stout considered these earlier awards. In one award, decided by Arbitrator Barton, he summarized the state of the law:

There have been a number of decisions which have dealt with clauses of this sort. To summarize the jurisprudence which is relevant here, an Employer is required to act reasonably. Some arbitrators interpret this to mean that the Employer cannot be negligent. The Employer is not required to take superhuman care to avoid a shut-down but reasonable care. It is required to anticipate what might normally occur and to take reasonable precautions to be sure that production can continue.

In that case, the arbitrator dismissed the grievance (involving a snow storm) concluding that the employer "took reasonable precautions to provide snow removal equipment but because of the timing of the storm, the wind direction, the additional freezing rain, its precautions were not enough.”

In a later National Steel Car case, decided by arbitrator Whitehead, the arbitrator allowed the grievance (involving a snow storm) because the precautions put in place to deal with the snow was sufficient, it’s just that there was a high level of absenteeism and, for that reason, the shift was cancelled. The link between the cancelled shift and the event that the employer argued was beyond its control was not direct.

Arbitrator Stout in the most recent National Steel Car case held that, in the circumstances, the event was beyond the control of the employer and “had a direct and substantial impact on the operation of the transfers and the plant generally.”

In dismissing the grievance, Arbitrator Stout concluded:

The Company had in place a protocol to address the removal of snow to ensure continued production. The storm became intense much later than expected and it is clear that the Company had issues keeping up with the snow accumulation. Management made a decision based on what they knew at the time and having due regard for the safety of their employees and plant. It would be unfair for me to second guess the decision of management in these circumstances. As said by Arbitrator Barton, the Company is not required to be superhuman, they only need to take reasonable precaution. In these circumstances, I am satisfied that they did in fact take such reasonable precaution, but were unable to keep up and insure the plant could run safely. [Emphasis added]

A more recent case to consider the issue (and the National Steel Car case) was Gentek Building Products Limited Partnership (2014) CanLII 77312 (ON LA). Arbitrator Goodfellow discussed the meaning of “beyond the control of the Company” and referred, with approval, to the following comment of Arbitrator Saltman in Robertshaw Controls of Canada Inc. (1989), 5 L.A.C. (4th) 124 (Saltman):

The term “beyond the control of the Company” is not defined in the collective agreement. However, it is generally understood that this term refers to circumstances which could not have been avoided with the exercise of reasonable care. This does not mean that the Company is expected to take every possible step to avoid even the most remote risk but only that it must anticipate those risks which are reasonably foreseeable and take steps to avoid them: see Re Sasco Tubes Ltd. and United Steelworkers, Local 8341 (1978), 15 L.A.C. (2d) 99 (A.M. Linden).

In discussing the circumstances of the case before him and the article in the collective agreement dealing with reporting pay, he stated:

The Company is not, by Article 32, placed in the position of an insurer of even four hours of employee work or wages against all perils but only against those the occurrence of which, with reasonable care and diligence, it could not have been prevented or avoided.

He held that the onus was on the company to establish that the exception to reporting pay applied (specifically “It must demonstrate that the reason for the lack of work was a condition beyond its reasonable control”.) On the facts of the case before him, the arbitrator concluded that the employer had failed to do so, he allowed the grievance and awarded compensation to the affected employees.

The Moral of this Story

These cases establish that the employer is not held to a standard of perfection in these matters, but to a standard of reasonableness. To repeat arbitrator Stouts’ words “the Company is not required to be superhuman, they only need to take reasonable precaution.” Safety is an important consideration, but it is not the only consideration. It is important that the employer not “panic” or engage in a “knee jerk” response to the situation.

That said, and subject to the particular language in the collective agreement, where the employer takes reasonable precautions or steps to deal with the matter, and these prove ineffective, then the employer will be well positioned to argue that the situation is beyond the control of the employer.

February 17, 2015

The Ontario Government today announced that it would follow through on its "commitment made in the 2014 Throne Speech" and launch public consultations on the changing nature of the modern workplace to commence. According to the News Release:

The consultation will be conducted under the auspices of special advisors “C. Michael Mitchell, formerly of Sack Goldblatt Mitchell LLP, and the Honourable John C. Murray, a former justice of the Ontario Superior Court and prominent management labour lawyer.”

The special advisors will:

…. provide guidance on the engagement process and solicit input from the public by participating in regional consultations, holding targeted stakeholder meetings and soliciting written submissions. They will also examine academic and inter-jurisdictional research on the changing workplace.

Following the consultation process, the special advisors will submit a report to the government with their recommendations.

Thus, while factors such as demeanor, the ability to recall events and to resist the tug of self interest are important in determining the credibility of a witness, the most significant consideration is the analysis of whose evidence makes the most sense in all of the circumstances. [emphasis added]

We've been dealing with this classification (or intermediate category as it is sometimes called in the case law) for some time. It is a middle ground between independent contractor on the one hand and employee on the other.

February 10, 2015

Arriving at the truth is the aim of any adjudication. But that’s easier said than done. Decision makers (judges, arbitrators, statutory bodies such as the human rights tribunal or labour relations board) have to assess the credibility of witnesses when weighing accounts of disputed facts Employers also must assess credibility in cases where a conflict about “what happens” is present. For example, when investigating a complaint of employee misconduct.

Assessing credibility is not a science. It is very difficult for a trial judge to articulate with precision the complex intermingling of impressions that emerge after watching and listening to witnesses and attempting to reconcile the various versions of events.

A leading case is Faryna v. Chorny [1952] 2 D.L.R. 354 (B.C.C.A.) in which the Court of Appeal said:

If a trial Judge's finding of credibility is to depend on which person he thinks made the better appearance of sincerity in the witness box, we are left with a purely arbitrary finding and justice would then depend upon the best actors in the witness box. On reflection it becomes almost axiomatic that the appearance of telling the truth is but one of the elements that enter into the credibility of the evidence of a witness. Opportunities for knowledge, powers of observation, judgment and memory, ability to describe clearly what he has seen and heard, as well as other factors, combine to produce what is called credibility ... A witness by his manner may create a very unfavourable impression of his truthfulness upon the trial Judge, and yet the surrounding circumstances in the case may point decisively to the conclusion that he is actually telling the truth. I am not referring to the comparatively infrequent cases in which a witness is caught in a clumsy lie.

The credibility of interested witnesses, particularly in cases of conflict of evidence, cannot be gauged solely by the test of whether the personal demeanour of the particular witness carried the conviction of the truth. The test must reasonably subject his story to an examination of its consistency with the probabilities that surround the currently existing conditions. In short, the real test of the truth of the story of a witness in such a case must be its harmony with the preponderance of the probabilities which a practical and informed person would readily recognize as reasonable in that place and in those conditions. [Emphasis added]

Demeanour is a factor, but it can be a misleading factor. As an arbitrator stated in Quality Meat Packers Limited (2013) CanLII 15073 (ON LA):

…. although I have considered the demeanour of the witnesses when giving their evidence and the firmness of their professed recollections, I have placed greater emphasis on the clarity, consistency, and overall plausibility of every witness' testimony when compared to the testimony of other witnesses and tested by cross-examination; the ability of all witnesses to resist the influence of self-interest or self-justification when framing their answers; the consistency of witness testimony with the documentary material available to test recollection; whether the assertions of the witnesses were consistent with, or corroborated by, other objective evidence; and, what seems to me to be most likely in all the circumstances established by the reliable evidence

Assessing credibility is often very difficult. Obviously, it is non-scientific exercise (as the Supreme Court of Canada Gagnon).

The best we can do is ask how objectively speaking the witnesses story hangs together with “the preponderance of the probabilities”? Assessing credibility is a very human endeavour and like all human endeavours is uncertain and imperfect.

That said, appellate courts have shown great deference to trial judges findings of credibility. In R. v. W. (R.), [1992] 2 S.C.R. 122, McLachlin J. (as she then was) explained why courts of appeal must show particular deference to trial courts on issues of credibility. At the same time, however, she noted:

…. it remains open to an appellate court to overturn a verdict based on findings of credibility where, after considering all the evidence and having due regard to the advantages afforded to the trial judge, it concludes that the verdict is unreasonable.

But as a matter of principle, it seems to me that unreasonable findings of fact -- relating to credibility, to primary or inferred "evidential" facts, or to facts in issue -- are reviewable on appeal because they are "palpably" or "clearly" wrong. The same is true of findings that are unsupported by the evidence. I need hardly repeat, however, that appellate intervention will only be warranted where the court can explain why or in what respect the impugned finding is unreasonable or unsupported by the evidence. And the reviewing court must of course be persuaded that the impugned factual finding is likely to have affected the result.

It is a well-established principle that findings of fact made at trial based on the credibility of witnesses are not to be reversed on appeal unless it can be established that the trial judge made some "palpable and overriding error which affected his assessment of the facts”

In conclusion, the Supreme Court of Canada in H.L. v. Canada held:

With respect, I do not find persuasive any of the arguments advanced in support of the contention that the rules governing appellate intervention in Saskatchewan differ from those set out in Housen. On the contrary, I am satisfied for the reasons given that the standard of review for inferences of fact, in Saskatchewan as elsewhere in Canada, is that of palpable and overriding error and its functional equivalents, including "clearly wrong", "unreasonable" and "not reasonably supported by the evidence”.

…. narrative and recollection are strange. I think I clearly recall vivid or traumatic episodes in my life, starting with the time a pickup truck rammed the car in which I was riding with my mom as a pre-schooler in Jackson, Mississippi. I believe I'm sure that I was sitting in the front seat, in that era before seat belts or child safety-seats, and just missed hitting the windshield, being stopped by the padded dash. But maybe, this many years later, I'm fooling myself. There is no one else around who was there. Three or four times in the past 20 years, I've been in uncomfortable situations while flying an airplane. I think I could recount those episodes in second-by-second slo-mo detail. But I can't be absolutely sure.

Misremembering. This is a word that has been much in the news of late. When is someone lying and when is he or she simply not remembering something as it really happened? I recall reading an article in the Harvard Gazette several years ago that is still available online (Making sense of memory by Taylor Beck). Memory is a funny and complicated thing but these credibility principles are important in trying to get to the truth (whatever that is).

February 06, 2015

The Ontario Court of Appeal in Kotecha v. Affinia Canada ULC, 2014 ONCA 411 (CanLII) considered an appeal of a reasonable notice award of 24.5 months given to a 70 year old machine operator earning an annual salary of $37,918.40 having 20 years service with an auto parts manufacturer.

Background

Mr. Kotecha brought a motion for summary judgment in an action for wrongful dismissal under the simplified procedure. He was terminated without cause and, as such, the only real issue was the period of reasonable notice.

Mr. Kotecha was terminated and provided with 11 weeks working notice and severance pay of $14,656.

The Motion for Summary Judgment

The motions judge considered the Bardal v. Globe and Mail Ltd. factors:

There can be no catalogue laid down as to what is reasonable notice in particular classes of cases. The reasonableness of the notice must be decided with reference to each particular case, having regard to the character of the employment, the length of service of the [employee], the age of the [employee] and the availability of similar employment, having regard to the experience, training and qualifications of the [employee].

In discussing “age”, the motions judge referenced the following quote from the Supreme Court of Canada case of McKinley v. BC Tel 2001 SCC 38 (CanLII):

Barring specific skills, it is generally known that persons over 45 have more difficulty finding work than others. They do not have the flexibility of the young, a disadvantage often accentuated by the fact that the latter are frequently more recently trained in the more modern skills. Their difficulty is also influenced by the fact that many in that age range are paid more and will generally serve a shorter period of employment than the young, a factor that is affected not only by the desire of many older people to retire but by retirement policies both in the private and public sectors.

It is important to note that this statement was made in the context of a discussion about the Human Rights Code protection regarding age and certain changes in the age range protected under the Code.

It is apparent that people in that [45 to 65 years] age bracket will have more difficulty in finding similar employment with another company at the same wage rate.

I would be interested in seeing any studies that support the views expressed in McKinley and Movileanu that it is “generally known” and “apparent” that persons between 45 years and 65 years will “have more difficulty finding work than others”. I’m sure there must be some objectively verifiable evidence out there that supports these broad statements of fact, I am just not aware of it.

The Court found that the notice period was 22 months “as Kotecha claims” to which, it seems, was added the 11 weeks working notice for a total of 24.5 months.

Court of Appeal

The employer appealed and the Court of Appeal granted the appeal. The Court reduced the period of reasonable notice from 24.5 months to 18 months (less the 11 weeks working notice already provided).

The Court affirmed that the operative principles for determining the period of reasonable notice at common law were those set out in Bardal which involves an individualized and fact specific weighing of the relevant factors. Although the employer argued that the judge was bound by precedent and the concept of stare decisis (which requires that courts render decisions that are consistent with the previous decisions of higher courts), that idea was rejected where the entire exercise is so fact-specific.

That being said, the Court of Appeal observed:

Notwithstanding the foregoing, the court should strive to ensure that notice periods, which are inherently individual, are consistent with the case law. That was not done in this case.

This is consistent with the notion that the determining the period of reasonable notice is “more art than science” and yields a range of reasonableness.

The Court also observed that:

In our view, the notice period in this case, totalling 24 and one-half months, is excessive and there are no exceptional circumstances that would justify this award.

Although it is true that reasonable notice of employment termination must be determined on a case-specific basis and there is no absolute upper limit or ‘cap’ on what constitutes reasonable notice, generally only exceptional circumstances will support a base notice period in excess of 24 months.

The upper limit of 24 months will only be exceeded in exceptional circumstances.

The Moral of This Story

This case is important in that it reaffirms the relevant factors to be taken into account when determining the common law period of reasonable notice. The case is significant as the fear, when the motions judgment was handed down, was that “age” would be given greater weight than the other Bardal factors. The Court of Appeal found that this was not the case. In Ontario there seems to be a “soft-cap” of 24 months on reasonable notice which can be exceeded in “exceptional circumstances”.

The case highlights the unpredictability in determining what a court will consider as relevant when determining the period of reasonable notice at common law. As such, it is in the employers interest to take the guesswork out of the equation by crafting a termination provision in the written contract of employment that spells out clearly and unambiguously the employees’ entitlement on termination. The case is also relevant as it appears to implicitly acknowledge as a “given” that employees over 45 years will have a harder time finding replacement employment than those younger than 45 years.

February 05, 2015

The Nova Scotia Court of Appeal considered this in Kerr v. Valley Volkswagen, 2015 NSCA 7. It upheld the trial judgement where the court held that the employee had resigned his employment. Essentially, he gave the employer an ultimatum, - give him a raise or he quits. After letting the matter sit for a few weeks, and with the employee not changing his mind, the employer accepted his resignation.

The employee argued that:

….. even if his words amounted to a resignation, he was entitled to resile from that resignation, unless his employer had acted upon it to its detriment. In his submission this would require the employer to have incurred some expense or suffered some pecuniary loss, as a consequence. Examples were given, such as having to hire a replacement or having to post and pay for an advertisement to fill the vacancy, etc. In other words -- according to the appellant -- Valley Volkswagen could not terminate their employment relationship by merely accepting Mr. Kerr's resignation, but must instead have done something more to its detriment. Under the appellant's view, an employee has the right to resile from a resignation up to the point that the employer relies upon that resignation to its detriment.

The Court of Appeal disagreed and held that this view of the law was wrong. It held that a resignation is simply and offer which could be accepted (prior to its being retracted). Once the offer is accepted, a valid contract is formed. The only time that “detriment” comes into it is in cases where the offer has not yet been accepted.

According to the Court:

From these and similar cases we see that a critical question whenever resilement is pleaded, is whether the threat (offer) to quit was accepted and whether the retraction of the resignation occurred prior to the communicated acceptance. Any issue with respect to an employer's detrimental reliance only arises if the employee's resignation has not been accepted.

In the Kerr case, the Court of Appeal provided an example of how all this works:

After the resignation was accepted, Mr. Kerr attempted to resile by asking for his job back. Had Mr. Kerr retracted his offer to resign during the intervening three weeks, he would not necessarily have been bound by the resignation, and the employer would have had to show detrimental reliance in order to enforce it. However, as the offer was accepted prior to it being retracted, there was no need to consider the employer's reliance (to its detriment).

January 26, 2015

The Supreme Court of Canada released an important employment law decision on May 22, 2014. The case is McCormick v. Fasken Martineau DuMoulin LLP, 2014 SCC 39 and established that “dependency” will determine if an employment relationship exists.

The case concerned whether an equity partner in a national law firm could be considered an employee for purposes of the British Columbia Human Rights Code? The Court held that, on the facts of this case, the equity partner was not an employee for purposes of the Code.

In reaching this conclusion, the Court noted:

Deciding who is in an employment relationship for purposes of the Code means, in essence, examining how two synergetic aspects function in an employment relationship: control exercised by an employer over working conditions and remuneration, and corresponding dependency on the part of a worker. In other words, the test is who is responsible for determining working conditions and financial benefits and to what extent does a worker have an influential say in those determinations? The more the work life of individuals is controlled, the greater their dependency and, consequently, their economic, social and psychological vulnerability in the workplace.

This simplified and refocused test is welcome given a patchwork of tests that have emerged over the years for determining whether an employment relationship or “something else” exists.

Every case decided by the Supreme Court of Canada is significant. McCormick is a case of national importance when dealing with threshold tests that have been a source of confusion in their application.

There is no doubt that the McCormick test of control and dependency will be applied in a variety of employment law contexts (for example, when determining whether an individual is an employee or independent contractor under legislation and at common law).

While the ultimate decision will always be fact-specific it is certainly nice to have a simplified test that will continue to develop as it is applied.

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